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Group health insurance dying

Sample Blue Cross Blue Shield health insurance card

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MARK AUSTIN THOMAS: Affordable health care is hard to come by for a lot of people. It's even harder for older Americans who have pre-existing conditions. Many rely on group coverage through a local business association, but that kind of coverage is going the way of doctors who make house calls. Tomorrow the California Association of Realtors will go to court to stop its insurer from dropping its coverage. Marketplace's Jeff Tyler explains.


JEFF TYLER: Blue Shield's contract with the California Association of Realtors basically covers every member of the group, regardless of medical conditions.

In return, 75 percent of interested association members must participate in Blue Shield's plan. That helps balance the cost of the sick with less-expensive, healthy clients.

Tom Epstein is a spokesman for Blue Shield of California.

TOM EPSTEIN: They failed to meet that requirement and we terminated the contract.

Ultimately, a judge will decide if the contract has been broken.

Meanwhile, folks like 62-year-old real estate broker Marcy Garber-Carter are caught in the middle.

MARCY GARBER-CARTER: I'm the poster child for pre-existing conditions. I've beat breast cancer twice, once in each breast. And that makes me not the most positive candidate for most insurance companies.

For many Americans in small businesses, group insurance is often the only affordable option. But at trade associations across the country, those plans are disappearing.

In a recent survey, the American Society of Association Executives found that only 24 percent of its members provide health insurance. John Graham is the organization's CEO.

JOHN GRAHAM: They're not permitted to get that insurance coverage because of the cost features, and we're finding that that situation is escalating. And more and more associations are unable to provide health insurance.

On the day she got her cancellation notice in the mail, Marcy Garber-Carter went to the Blue Shield website, hoping for clarification. Instead, she found:

GARBER-CARTER: The article on the Blue Shield page referenced how much money they had made — what their profit was for that year. And it made me sick to my stomach.

She thinks the company dumped her because she's not profitable enough.

But Tom Epstein with Blue Shield says that's not the case. In fact, he says Blue Shield supports universal health care for all Californians.

EPSTEIN: Everyone ought to be covered. And if everyone is covered, then the risk will be widely shared and everyone benefits from that.

In the meantime, realtor Marcy Garber-Carter says her insurance alternatives would provide fewer services, charge more per month and significantly raise her deductibles.

In Los Angeles, I'm Jeff Tyler for Marketplace.

About the author

Jeff Tyler is a reporter for Marketplace’s Los Angeles bureau, where he reports on issues related to immigration and Latin America.

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